HB2838 101ST GENERAL ASSEMBLY

LRB101 07526 TAE 52571 b

101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
HB2838

Introduced , by Rep. Jennifer Gong-Gershowitz

SYNOPSIS AS INTRODUCED:

820 ILCS 115/13.5 new

Amends the Illinois Wage Payment and Collection Act. Provides that, for contracts entered into on or after July 1, 2019, a direct contractor making or taking a contract in the State for the erection, construction, alteration, or repair of a building, structure, or other private work shall assume, and is liable for, any debt owed to a wage claimant or third party on the wage claimant's behalf, incurred by a subcontractor at any tier acting under, by, or for the direct contractor for the wage claimant's performance of labor included in the subject of the contract between the direct contractor and the owner. Provides for enforcement by the Department of Labor. Provides authorization for third parties owed fringe or other benefits or a joint labor-management cooperation committee to bring a civil action to enforce liability against a direct contractor. Provides exemptions for work done by an employee of the State or any political subdivision of the State. Provides requirements and guidelines for notice, awards, filing, and records retention. Provides that the new provisions are severable, and that the obligations and remedies provided are in addition to any obligations and remedies otherwise provided by law. Provides that nothing the Section shall alter specified obligations and penalties set forth in the State Prompt Payment Act. Effective immediately.

A BILL FOR

AN ACT concerning employment.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Illinois Wage Payment and Collection Act is amended by adding Section 13.5 as follows:

(820 ILCS 115/13.5 new)

Sec. 13.5. Primary contractor responsibility in wage claims in construction industry.

(a)(1) For contracts entered into on or after July 1, 2019, a direct contractor making or taking a contract in the State for the erection, construction, alteration, or repair of a building, structure, or other private work shall assume, and is liable for, any debt owed to a wage claimant or third party on the wage claimant's behalf, incurred by a subcontractor at any tier acting under, by, or for the direct contractor for the wage claimant's performance of labor included in the subject of the contract between the direct contractor and the owner.

(2) The direct contractor's liability under this Section shall extend only to any unpaid wage, fringe or other benefit payment or contribution, including interest owed, but shall not extend to penalties or liquidated damages.

(3) A direct contractor or any other person shall not evade or commit any act that negates the requirements of this Section. This Section does not prohibit a direct contractor or subcontractor at any tier from establishing by contract or enforcing any otherwise lawful remedies against a subcontractor it hires for liability created by the nonpayment of wages, fringe or other benefit payments, or contributions by that subcontractor or by a subcontractor at any tier working under that subcontractor.

(b)(1) The Department of Labor may enforce against a direct contractor the liability for unpaid wages created by subsection (a) pursuant to this Act or through a civil action. The direct contractor's liability shall be limited to unpaid wages, including any interest owed.

(2) A third party owed fringe or other benefit payments or contributions on a wage claimant's behalf may bring a civil action against a direct contractor to enforce the liability created by subsection (a). The court shall award a prevailing plaintiff in such an action its reasonable attorney's fees and costs, including expert witness fees.

(3) A joint labor-management cooperation committee established pursuant to the federal Labor Management Cooperation Act of 1978 (29 U.S.C. Sec. 175a) may bring an action in any court of competent jurisdiction against a direct contractor or subcontractor at any tier for unpaid wages owed to a wage claimant by the direct contractor or subcontractor for the performance of private work, including unpaid wages owed by the direct contractor, pursuant to subsection (a). The court shall award a prevailing plaintiff in such an action its reasonable attorney's fees and costs, including expert witness fees. Prior to commencement of an action against a direct contractor to enforce the liability created by subsection (a), the committee shall provide the direct contractor and subcontractor that employed the wage claimant with at least 30 days' notice by first-class mail. The notice need only describe the general nature of the claim and shall not limit the liability of the direct contractor or preclude subsequent amendments of an action to encompass additional wage claimants employed by the subcontractor.

(4) No other party may bring an action against a direct contractor to enforce the liability created by subsection (a).

(c) Unless otherwise provided by law, property of the direct contractor may be attached, after trial, for the payment of any judgment received pursuant to this Section.

(d) A civil action authorized by this Section must be commenced within one year from the date the claimed labor was performed or the claimed contract work was substantially completed or abandoned, whichever occurred first.

(e) This Section does not apply to work performed by an employee of the State, a special district, a city, a county, or any political subdivision of the State.

(f)(1) Upon request by a direct contractor to a subcontractor, the subcontractor and any lower-tier subcontractors under contract to the subcontractor shall provide payroll records, that, at a minimum, contain the information set forth in Section 10 of its employees who are providing labor on a private work, which payroll records shall be marked or obliterated only to prevent disclosure of an individual's full social security number, but shall provide the last four digits of the social security number. The payroll records must contain information sufficient to apprise the requesting party of the subcontractor's payment status in making fringe or other benefit payments or contributions to a third party on the employee's behalf.

(2) Upon request of a direct contractor to a subcontractor, the subcontractor and any lower-tier subcontractors under contract to the subcontractor shall provide the direct contractor award information that includes the project name, name and address of the subcontractor, contractor with whom the subcontractor is under contract, anticipated start date, duration, and estimated journeymen and apprentice hours, and contact information for its subcontractors on the project.

(3) A subcontractor's failure to comply with this subsection shall not relieve a direct contractor from any of the obligations contained in this Section.

(g) For purposes of this Section, "direct contractor" means a contractor that has a direct contractual relationship with an owner. A reference in another statute to a "prime contractor" in connection with the provisions in this Section means a "direct contractor." "Subcontractor" means a contractor that does not have a direct contractual relationship with an owner. "Subcontractor" includes a contractor that has a contractual relationship with a direct contractor or with another subcontractor.

(h) The obligations and remedies provided in this Section shall be in addition to any obligations and remedies otherwise provided by law, except that nothing in this Section shall be construed to impose liability on a direct contractor for anything other than unpaid wages and fringe or other benefit payments or contributions, including interest owed.

(i) Nothing in this Section shall alter the owner's obligation to timely pay a direct contractor as set forth in Section 3-2 of the State Prompt Payment Act, or a direct contractor's obligation to timely pay a subcontractor as set forth in subsection (a) of Section 7 of the State Prompt Payment Act, or the penalties for failing to make a timely payment as set forth in subsection (b) of Section 7 of the State Prompt Payment Act, except that if a subcontractor does not timely provide the information requested under paragraphs (1) and (2) of subsection (f), the director contractor may withhold as "disputed" all sums owed until that information is provided.

(j) The provisions of this Section are severable. If any provision of this Section or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.

Section 99. Effective date. This Act takes effect upon becoming law.